Crude resumes advance as US crude stockpiles fall

Bloomberg

Oil resumed gains after the biggest drop in more than a week as industry data showed US crude stockpiles declined, while OPEC and other producing nations trim production to ease a global glut.
Futures rose as much as 1.4 percent in New York after sliding 2.7 percent on Wednesday amid a surge in the dollar. US crude supplies fell by 5.04 million barrels last week, the American Petroleum Institute was said to report. Government data Thursday is also forecast to show a decline. US production will increase this year as output cuts by OPEC and 11 other nations spur an industry revival, the International Energy Agency said in a monthly report.
Oil has held above $50 a barrel since OPEC and nations including Russia agreed late last year to trim supply by about 1.8 million barrels a day to reduce bloated global inventories. While producers from Saudi Arabia to Iraq have signaled they’re implementing the reductions, the International Energy Agency predicted a rebound in US shale output as prices rise.
“There is clear evidence of a supply response from the US but the market is full of optimism about
the OPEC agreement,” said Michael McCarthy, chief market strategist
at CMC Markets in Sydney. “We’re seeing a trading range being established and the support level is around $50 a barrel.”
West Texas Intermediate for February delivery, which expires Friday, rose as much as 73 cents to $51.81 a barrel on the New York Mercantile Exchange and was at $51.59 at
9:09 a.m. in London. Total volume traded was about 21 percent below the 100-day average. The contract lost $1.40 to $51.08 on Wednesday, the most since Jan. 9. The more-
active March futures climbed 48 cents to $52.37.